GST on Steel & Cement Trading

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This discussion clarifies GST rules for trading steel and cement, particularly concerning input tax credit (ITC) when supplying these materials to a contractor for your own warehouse construction. Generally, you can claim ITC if you sell cement and steel to the contractor. However, ITC is not available if the contractor provides the GST bill. Steel attracts 18% GST, while cement is subject to a 28% GST rate, with no additional cess beyond this.

Vivek Savla

Vivek Savla (Querist)
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30 January 2024 Sirs,
In order to protect the Rate Fluction of Cement & Steel for our own warehouse construction, we have only supplied the same to the Contractor at the contract rate with them. As like Trading of activity of the said Goods, hence we have utlised the credit of the same against the sales made to the same contractor. Can this credit is allowed under GST?

As we have not taken the credit of Works Contract Bills given the contractor for constrction of Warehouse including the same items.

RAJA P M

RAJA P M (Expert)
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31 January 2024 Yes, You can claim if You sell the cement and Steel to the Contractor. But, ITC not available If Contractor give GST bill.

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Aashok Kumar Sharma

Aashok Kumar Sharma

(Expert)
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17 August 2025 Steel trading (iron, steel products) attracts 18% GST.
Cement trading comes under the highest GST slab of 28%.
Be cautious about misquoted cess—there is no additional cess beyond the 28% GST for cement. The total applicable tax remains 28%, not the inflated 31.36% sometimes cited.
Also, ensure correct HSN classification (such as 6810 for cement products) to avoid mismatches in tax rates and maintain clean compliance.
Summary Table:
Product GST Rate Notes
Steel 18% Standard rate
Cement 28% High GST slab, no extra cess

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